With low priced original home videos on offer at a fractionally high cost, who would want to waste money on pirated stuff?
Finally, Moser Baer may have found the formula to checkmate video piracy, which has been the bane of the Indian movie industry for a long time. The company has decided to hit back with very low priced home videos.
With low margins and high volumes, the company says it will be able to hit the video pirates where it hurts them most - their margins. "Priced at a range as low as Rs 28-34, our home videos compete with the pirated ones," said G Dhananjayan, COO (entertainment division), Moser Baer India. An estimated 80-90 per cent of all home videos are pirated.
There is, however, one big factor working in favour of video pirates. The law doesn't permit home videos of new movies to be released along with the movies. The moratorium can stretch up to one year and varies from language to language, says an industry expert.
In case of Hindi movies, it can be as short as 15 days if a movie bombs at the box office, but in case of hits it can take up to two months before the home video of the movie is legally released.
Moser Baer Home Entertainment division, which was launched by Moser Baer India in December 2006, has recently entered the Kannada home video market. In early January, the company launched 101 Tamil titles in Tamil Nadu, a move which it claims has received an overwhelming response.
In late January, the company announced its entry into the Malayalam market with 101 Malayalam titles. The last market they plan to enter is the Hindi home video, which incidentally is also the biggest. On an average, the company spends about Rs 100,000 on acquiring rights to older titles and Rs 10-15 lakh (Rs 1-1.5 million) on new ones.
Moser Baer has, till now, bought rights to only old and new regional titles. It has been able to steal a march on video pirates by offering viewers high quality videos at only a fractionally higher price offered by the pirates. But its real pricing challenge will come when it tries to secure rights to a Hindi blockbuster whose producers think it still has box office mileage.
Home videos earn the producers of Hollywood movies the biggest revenues but then piracy is not a menace in the developed world.
Moser Baer India is the world's second largest maker of optical storage devices such as CDs and DVDs. The company says home videos are a forward integration of its business. It releases video content in DVD and VCD formats using its patented technology, which significantly reduces cost.
In future, the company intends to enter in-house content development, animation, video games, sports on CDs, buying rights from History Channel and National Geographic to some of their content and such other infotainment that people can watch. That's for quality entertainment.
